What counts as income for Obamacare?
Updated November 2026
Your Marketplace subsidy is based on household modified adjusted gross income (MAGI), not your take-home pay and not just your wages. Getting this number right is the single biggest factor in whether you repay part of your subsidy at tax time.
Counts as income
| Income | Notes |
|---|---|
| Wages, salary, tips, bonuses | Use the taxable amount (box 1 of your W-2), after pre-tax 401(k) and health deductions. |
| Self-employment and gig income | Net profit after business expenses, not gross receipts. Payments through Cash App, PayPal or Venmo for work count whether or not you get a tax form. |
| Unemployment benefits | Fully counted. |
| Social Security benefits | All of it, including the part that isn't taxed. SSI does not count. |
| Retirement withdrawals | Traditional IRA and 401(k) withdrawals, pensions, and Roth conversions. |
| Investment income | Capital gains, dividends, interest, and tax-exempt interest. |
| Rental income | Net, after expenses. |
| Dependents' income | Only if the dependent is required to file a tax return. |
Does not count
- Child support received, gifts, inheritances, and loans
- Supplemental Security Income (SSI), veterans' disability benefits, and workers' compensation
- Qualified Roth IRA distributions
- Income of a dependent who isn't required to file
What lowers it
Deductible contributions to a traditional IRA, HSA, or SEP-IRA, the self-employed health insurance deduction, half of self-employment tax, and pre-tax payroll deductions all reduce MAGI. See how to lower your income for the premium tax credit.
Add up your 2026 income and see whether you are likely to repay, in about three minutes.
Estimate your 2026 repaymentFor 2026 coverage, the subsidy stops at 400% of the poverty line ($62,600 for one person in the 48 contiguous states). See the full income limit table.
Related guides
This guide is general information, not tax advice. Clawback Check is not affiliated with HealthCare.gov, any state Marketplace, or the IRS.